* Raises full-year net profit forecast 13 pct
* Second-quarter net profit rises 70 pct to 438.4 bln yen
* Raises North American 2013/14 car sales forecast
* Gain in quarterly net profit outperforms big Japan rivals
By Yoko Kubota
TOKYO, Nov 6 (Reuters) - Toyota Motor Corp isclosing in on a record profit set before the Lehman crisis aftertopping up its annual net profit forecast by nearly $2 billionand outperforming Japanese rivals as its expansion plans bearfruit.
The world's best-selling carmaker is racking up strong salesin a healthy U.S. market while keeping costs in check and takinga breather from building new facilities, in contrast to NissanMotor Co and Honda Motor Co which aregrappling with heavy expansion costs.
Toyota, one of the most export-reliant Japanese carmakers, is also reaping the benefits of a weakening yen that has boostedits profit margins but acknowledged it will have to startspending more to maintain its advantage.
"Our basic stance of controlling fixed costs and improvinggross profit will not change, but we do need aggressiveinvestment in order to brush up on future technology," ManagingOfficer Takuo Sasaki told an earnings briefing on Wednesday.
Toyota credited its conservative strategy as a key factorwhen it raised its net profit forecast by 190 billion yen to1.67 trillion yen ($16.95 billion) for the year ending in March2014, just short of its record 1.72 trillion yen from six yearsago.
A Thomson Reuters I/B/E/S survey of 23 analysts gave anaverage forecast of 1.79 trillion yen. Toyota's annual operatingprofit rises by 40 billion yen for every one-yen rise in thevalue of the dollar.
Toyota, which went through a rapid expansion before bookinghuge losses in the year ended March 2009, now appears to be inthe sweet spot of industry and currency market trends, and isreaping the rewards of it own investments in production.
But some analysts warned against complacency.
"There are clearly risks of Toyota starting to lag in growthpace to its peers," said Takaki Nakanishi, an auto industryanalyst and CEO of Nakanishi Research Institute in Tokyo.
"If the decisions (on future expansion) are too slow, thatmay cause slower growth and that could make Toyota's earningsgrow slower than its competitors."
Market participants also worried that the company might betoo stingy with its cash.
"Toyota is representative of Japanese companies and eventhough it is generating so much profit its dividend yield of 2percent is not enough," said BNP Paribas Securities chief Japanequity strategist Shun Maruyama.
For the July-September quarter, Toyota said net profit rose70 percent to 438.4 billion yen, in line with the averageestimate of 441.01 billion yen in a Thomson Reuters I/B/E/Ssurvey of six analysts and outpacing Japan's second-biggestcarmaker Nissan and No.3 Honda Motor Co.
Last week, Nissan posted a meagre 2 percent quarterly netprofit growth while Honda booked a 46 percent rise.
Nissan is aiming to raise its global market share to 8percent from last year's 6.2 percent and has been scrambling tobuild capacity worldwide. It is constructing eight new plantsand expanding a factory in Russia.
Nissan plans capital expenditure equal to about 5 percent ofrevenue this financial year, compared with Toyota's 4 percent.On Wednesday, Toyota slightly raised its annual capitalexpenditure outlook by 2 percent to 940 billion yen.
To ease the burden of its expansion, Nissan and its partnerRenault SA unveiled a potentially wide-rangingoperating alliance this week with Mitsubishi Motors Corp.
Nissan's quick but messy expansion has left itunderperforming Toyota in the United States after running intoproduct launch troubles and quality issues.
In July-September, Toyota's U.S. sales grew 12.2 percentyear-on-year compared to Nissan's 9.6 percent rise.Industry-wide sales grew about 9 percent year-on-year duringthat period.
Toyota on Wednesday nudged up its North America salesforecast to 2.63 million vehicles from 2.61 million, helping tooffset a drop in its Asia sales forecast to 1.64 million from1.7 million.
Toyota's shares ended 0.5 percent higher, compared with a0.8 percent rise for Tokyo's benchmark Nikkei average.
For the year to date, Toyota's shares are up nearly 60percent, outpacing a 9 percent rise for Nissan, which was hithard this week after cutting its full-year profit forecast onFriday, and Honda's 25 percent rise.
Toyota sold the most cars among automakers worldwide inJanuary-September, beating General Motors Co andVolkswagen AG.
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